Audability: Extract from session 1 - introduction to audit
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This document provides an introduction to audit and corporate governance, explaining the essential roles and distinctions between external and internal audits. It outlines key concepts such as planning, risk assessment, evidence, and materiality, along with the objectives of audits in both private and public sectors. Additionally, it highlights the qualities of auditors and the benefits of auditing for accountability and management.
Audability: Extract from session 1 - introduction to audit
- 1. 1. Introduction to audit and corporate governance Audability Ltd 1
- 2. Spot the auditor Group exercise Audability Ltd 2
- 3. An audit involves…. Investigating information prepared by someone else to decide whether it is fairly stated Group exercise Audability Ltd 3
- 4. An audit involves…. Reporting back on your results Group exercise Audability Ltd 4
- 5. Four key concepts Planning Risk assessment Evidence Materiality Group exercise Audability Ltd 5
- 7. What is audit? Narrow External Audit Wider Internal Audit Widest Anything that uses the work audit e.g. a ‘Health and Safety Audit’ Audability Ltd 7
- 8. External versus internal audit External Audit Internal Audit Requirement Usually yes e.g. Companies Act Usually no Objectives ‘True and fair view’ Assurance on & sometimes more systems & controls Independence Never an employee Can be employees Reporting Shareholders/ public Audability Ltd Management 8
- 9. External audit: private vs public Private sector Public sector Requirement Yes – Companies Act Yes – different bits of legislation Objectives ‘True and fair view’ & sometimes more ‘True and fair view’ & value for money Independence Firm – appointed by shareholders Agency or firm – usually not appointed by body Reporting Shareholders Body/Parliament/ Public Audability Ltd 9
- 10. Some key qualities of auditors … o o o o Independence Integrity Objectivity Professional scepticism Audability Ltd 10